MONTREAL — Canada’s smaller cities and airports are the latest to bear the brunt of COVID-19’s impact on Air Canada.
The airline has announced the indefinite suspension of service on 30 domestic regional routes as well as the discontinuation of service to eight Canadian airports as it streamlines its operations amid the pandemic and the ongoing travel restrictions and advisories. All have sharply cut demand and reduced airline networks to a fraction of their usual size.
Air Canada says continuing weak demand for both business and leisure travel due to COVID-19, and provincial and federal government-imposed travel restrictions and border closures, “are diminishing prospects for a near-to-mid-term recovery.”
The company warns that further service suspensions may be necessary over the coming weeks as it navigates the unprecedented situation brought on by COVID-19.
Air Canada has said it expects the industry’s recovery will take a minimum of three years.
Air Canada’s President and CEO Calin Rovinescu is a member of the Canadian Travel & Tourism Roundtable. Together with industry execs from Canada’s other major airlines as well as several tour operators, retailers and host agencies, the coalition has issued an urgent call to government officials, saying that as other countries around the world start to lift travel restrictions, it’s time for Canada to do the same.
The group sent an open letter to the federal government and provincial premiers in early June. Canadian business leaders from banks, telecoms and more, plus airlines including Air Canada, signed a second open letter with a similar #timetotravel message.
Air Canada’s announcement today includes airport closures and route suspensions….
Air Canada announced this morning that it will shutter service from these 8 regional airports
- Bathurst, NB
- Wabush, NL
- Gaspé, QC
- Baie Comeau, QC
- Mont Joli, QC
- Val d’Or, QC
- Kingston, ON
- North Bay, ON
Air Canada also announced that the following routes will be suspended indefinitely as per applicable regulatory notice requirements. The airline says impacted passengers will be contacted by Air Canada and offered options, including alternative routings where available.
MARITIMES / NEWFOUNDLAND AND LABRADOR
Deer Lake-Goose Bay
Deer Lake-St. John’s
Goose Bay-St. John’s
QUEBEC & ONTARIO
Baie Comeau-Mont Joli
Gaspé-Iles de la Madeleine
As a result of COVID-19, Air Canada reported a net loss of $1.05 billion in Q1 2020, including a net cash-burn in March of $688 million.
The airline says it has undertaken a range of structural changes including significant cost savings and liquidity measures. Other measures include:
- A workforce reduction of approximately 20,000 employees, representing more than 50 per cent of its staff, achieved through layoffs, severances, early retirements and special leaves;
- A company-wide Cost Reduction and Capital Deferral Program, that has to date identified around $1.1 billion in savings;
- A reduction of its system-wide capacity by approximately 85 per cent in the second quarter compared to last year’s second quarter and an expected third quarter capacity reduction of at least 75% from the third quarter of 2019;
- The permanent removal of 79 aircraft from its mainline and Rouge fleets;
- Raising approximatively $5.5 billion in liquidity since March 13, 2020, through a series of debt, aircraft and equity financings.